Avidity Biosciences is a medical stock. This company is currently working on a new class of oligonucleotide-based therapies called antibody oligonucleotide conjugates. It designs AOCs in such a way as to overcome current treatment limitations. Avidity Biosciences wants to provide its customers with better treatments for a wide range of serious diseases.
Wells Fargo thinks that this stock is a Buy. Its analyst Jim Birchenough noted that the firm’s positive outlook is based on Avidity Biosciences’s leading AOC platform. The company is planning to extend the benefit of RNA therapeutics beyond the liver and localized CNS delivery of category leader drug approvals.
Several other companies have also tried to make headway in the myotonic dystrophy (DM1) space. Biogen and Ionis Pharmaceuticals yielded evidence of target knockdown and positive downstream effects on key splice variants in DM1 patients. They achieved adequate tissue concentration, but the effect was limited to only a small sample size at a very high dose.
On the other hand, Preclinical data for AOCs showed that lower doses resulted in a 50-75% DMPK target knockdown. The Phase 1 program for the firm’s AOC1001 asset will probably be initiated in 2021. And Birchenough thinks that when it happens, early data on target knockdown should be predictive of clinical benefit. Considering the clear role of DMPK in disease pathogenesis as well as lower disease burden in patients with reduced DMPK expression, it seems a good bet.
Furthermore, RNA has clinical programs in Duschenne Muscular Dystrophy (DMD) and muscle atrophy, which will kick off in 2022. And the company’s pipeline includes AOC candidates for genetic muscle diseases, including Pompe disease and facioscapulohumeral muscular dystrophy.
Who do analysts rate this stock?
The analyst thinks that broader efforts beyond muscle disease, including the large immunology collaboration with Eli Lilly for up to 6 targets and $405 million in milestones each, along with sales royalties, represent significant option value. He thus set a $60 price target, suggesting an impressive 153% upside potential.
Other analysts agree with Birchenough, giving the stock a Strong Buy rating. At $43.33, the average price target has an upside potential at 83%.
